How to build your growth (marketing) strategy
Don’t pick channels & campaigns without going through these exercises
We’re in the midst of annual planning season, aka the time of year where many teams spend a whole bunch of time planning and then never look at those plans again.
There’s no better time for me to share my thoughts on building a high-impact growth strategy–and what exercises you should go through that will actually lead you to the right growth marketing plan for your business.
As I began writing this newsletter, I realized this is a 2 parter.
Part 1: What drives your growth marketing strategy? - this newsletter
This newsletter focuses on all the inputs you need to look (at least) annually to lay the foundation for your strategy.
Understanding the 4 high-level ways to drive growth
Analyzing and understanding the 3 marketing strategy drivers (your inputs)
Identifying and making room for big bets
Part 2: What growth levers should you choose? - coming in November
Next month’s newsletter will help you actually pick the channels and campaigns you should focus on—aka how to make a plan you’ll actually look at regularly.
Prioritizing across your funnel & segments
Thanks to our (highly-curated) sponsors
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42 Agency is a trusted growth partner for B2B SaaS companies—including startups in the MKT1 Capital portfolio. Our agency helps startups with Demand Generation & RevOps to hit aggressive pipeline targets.
Why MKT1 recommends 42 Agency: If you want to implement growth initiatives, reach out to 42 Agency. They’ll be true strategic partners and a pleasure to work with.
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Why MKT1 recommends RevenueHero: When it comes to growth strategy, don’t just focus on top of funnel—you also need to increase conversion. We discovered RevenueHero when we wrote a newsletter on improving demo request flows a couple months back. Now we recommend them every time. If you don’t have a book a meeting step in your conversion flow, go check them out.
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1. Understand the 4 high-level ways to drive growth
Before you start trying random channels, launching campaigns, and making random landing pages, you should understand your company’s highest leverage way to drive growth right now.
The good news: There are really only four high-level ways to grow revenue. And since I like dessert—and I like pi(e) related frameworks—here’s how I think about these 4 levers:
How to use this framework
In this (over?)extended metaphor, pie = market or market segment
Each quarter, prioritize these high-level levers (just don’t try to say that phrase out loud when you do). Your priorities will likely change quarter over quarter.
Hypothetically, you could focus too much on going after new markets one quarter, so your growth in proven markets stalls. The following quarter, you should swing back around to focusing on that lever as your top priority. Or you could drive so much new web traffic in a quarter that you realize you desperately need to fix your leaky bucket before you continue to accelerate top of funnel growth. Whatever the case may be, it’s important to have these prioritized—and get buy in on these priorities across your company.
Each lever lends itself to a specific strategy. Here's the high-level strategy for each:
Expand the pie (or test new pies)
Go after new markets or segments (verticals, geos, etc.).
Note: If you’re very early-stage, you likely won’t have an existing market or audience segment you’re successfully selling to, so expanding the pie really just means testing new segments to try to find product/market fit.
Sometimes when moving to new markets you can use the same channels you already use to drive growth; other times you need to try completely new channels (i.e. add in outbound or partner marketing).
Create new "fuel" (content, messaging) tailored to the new “pie”.
Test new markets or segments first before going all in (i.e. try paid search and a tailored landing page or try outbound driving to a webinar with speakers from the same segment).
To determine if you should double down on this market or segment, make sure you have similar or higher conversion rates throughout the funnel (even though the sample size might be small). Once you get to this point, expand your efforts.
Once you can drive higher full-funnel conversion at a larger scale, expand your efforts in this market even more. More on testing & scaling below.
Capture more of the same pie
Continue to expand on what’s working, while adding in tests and big bet projects to jolt growth.
Watch out for diminishing returns, especially on paid efforts when you’ve been going after the same market for a while (especially if it’s a niche market).
Just don’t wait too long to expand from your original pie; it may take longer than you think to expand.
Capture new pie more efficiently
This method is related to capturing more of the same pie, but involves driving more revenue with the same amount of top of funnel volume.
When top of funnel stays the same, but you improve conversion rates, revenue goes up.
When the budget stays the same, but you lower your customer acquisition cost or increase the quality of leads, you can drive more volume for the same cost. Revenue goes up.
Increase conversion rates AND decrease acquisition costs and you're really cooking with gas (to mix metaphors just a bit).
Focus on improving web conversion, sign up or request a demo flow conversion, and optimize paid efforts to drive growth in this way.
Get more money from your slice of the pie
Drive more revenue from existing customers (or soon to be customers) by promoting new features or changing perceived value through messaging or social proof.
Expand revenue per account by driving customers to pay for new features, increase the number of seats, or increase product usage. Lifecycle marketing, in-product marketing, and well executed product launches are the best way to do this.
You can also expand revenue per account by raising prices, this will impact new customers too. It’s hard to do this without increasing perceived value (especially when your audience is tech companies in this economy).
2. Understand the 3 marketing strategy drivers for your company
Once you understand the core way(s) you’ll drive growth, you can start to plan how you’ll do it. To effectively plan for high-impact growth, you need to do some foundational work first.
Much like you do positioning to help drive your marketing “fuel” (content, messaging, etc), you need to spend some time doing some foundational work to build the right “engine”.
To build your growth marketing foundation:
Make sure you’ve mapped your funnel and identified your KPIs (key performance indicators). I wrote about this recently. And don’t forget to track conversion rates–or you’ll never know if you need to focus on capturing your pie more efficiently!
Prioritize the 4 high-level ways to grow (what you just read about in section 1)
Deeply understand—what we at MKT1 call—the 3 strategy drivers. Focus on things you can be great at and remember not to follow another company’s playbook.
Pick a strategy that fits with your stage business, your audience, your market, your GTM motion, and your advantages.
These drivers are helpful for figuring out not only your growth marketing strategy, but your content strategy too. So at least 2x per year, make sure you analyze these inputs.
The drivers diagram is in a purposeful order:
Product marketing research should help inform your GTM motion
Both product marketing research and GTM motion help you identify your marketing advantages
Here’s how analyzing each of these areas guides your growth strategy:
A. Build your strategy around product marketing research (aka audience, market, and product research)
When marketing your startup, you must know what matters to your specific audience. But understanding your audience isn’t enough, you also need to understand who else is in your ecosystem. And not just competitors but also complementary companies who can help you drive growth. This research helps inform your positioning, audience segmentation, channel selection, and campaign planning.
Some things to keep in mind when using product marketing research to drive your strategy:
Marketers often focus audience analysis just on firmographics. It’s important to understand your audience qualitatively too. Make sure you understand everything about your audience’s workday, including where they get information and other tools they use. Here’s a simple example:
Your audience might be super active in a specific Facebook group (sorry to blow your Gen Z mind w/ the Facebook reference). Learning which specific Facebook groups or communities can unlock new channels for you.
Your audience might do a lot of work in spreadsheets, but not have great templates for those spreadsheets. Once you find out what these are, you can make spreadsheet templates for your audience.
Don’t stop at competitive analysis, map your entire ecosystem. These ecosystem “players” might be able to help you grow faster. Some examples:
Agencies or consultancies might be a great source of referrals or even a sales channel.
Complementary products or integration partners may not have help videos, despite heavy search traffic for that content. You can make how-to-videos about their product quickly using tools like Loom & Descript to capture some of their search traffic.
Doing this work will make certain growth channels obvious, and also help you check some channels that aren’t a good fit off your list.
B. Select a strategy that aligns with your go-to-market motion
Growth marketing at a B2B company with a self-serve motion compared to a sales-led motion is a different job–almost as different as B2C and B2B. Given this, your growth marketing strategy and tactics need to be 100% aligned with your GTM motion.
Typically, startups determine their purchase process (self-serve, sales-led, or hybrid) based on a few business attributes like deal size, total addressable market, time to close, audience, and how teams adopt the product (bottom up or top down). These same attributes also tend to dictate the channels that will be most successful for acquiring, nurturing, converting, and expanding customers.
Notes on growth strategy for sales-led startups:
Generally speaking, sales-led startups will use outbound (to prospects who haven’t yet come inbound) as a top of funnel channel. Sales-led startups typically do this in conjunction with some inbound.
If you’ve opted for a purely sales-led motion, you are likely going after large contracts and you have a list of target accounts.
When this is the case, it makes a lot of sense to do outbound and potentially account-based marketing towards these target accounts.
Remember to not make the only CTA “want to schedule a meeting?” when you do outbound. Provide value with content, templates & tools, or an educational webinar.
Notes on growth strategy for self-serve / PLG startups:
Typically, startups that allow customers to sign up and/or purchase self-serve rely on inbound channels more so than outbound.
If you have a self-serve or product-led growth motion, you’re typically going after a higher volume of lower contract value deals.
Meaning, you have not identified everyone in your addressable market, and you want to cast a wide net.
When you have a free product or self-serve upgrade path, you can nurture users using the product itself. This is a huge advantage over sales-led businesses that don’t offer a free or low-cost product to their prospects and have to rely on email only to nurture prospects into customers.
These are of course generalizations, and most B2B startups today have some sort of hybrid motion. The point is, your GTM motion is a great place to start to determine which channels to use. You may also discover in this process that your GTM motion isn’t the right fit for your business characteristics and audience. And that’s a much larger conversation and a whole other newsletter.
C. Identify and accelerate your marketing advantages
Deep dive into marketing advantages in this newsletter, which includes definitions for each advantage
Marketing advantages (an MKT1™ framework) are dynamics in a company’s DNA, product, or market that inherently drive growth. Think of these as tailwinds or catalysts for growth. Once you identify these, it’s obvious where to focus the bulk of your marketing efforts.
At MKT1, we are obsessed with marketing advantages. As we’ve written about, we built our entire fund, MKT1 Capital, on the thesis that startups can’t win without identifying their marketing advantages and accelerating them. So it’s really critical to identify, unlock, and lean into these advantages when planning your growth marketing activities—aka don’t skip this part!
Notes on identifying your marketing advantages:
Remember: Understanding the other 2 drivers (product marketing research & your GTM motion) first helps you identify your marketing advantages.
We break advantages into 3 categories, based on where the advantage comes from and the high-level strategies that typically work to accelerate the advantage (your product, your ecosystem, your marketing or company story).
If your startup doesn’t have marketing advantages, you need to adjust your product, your business strategy, or your go-to-market approach. They are that critical to your success.
Some advantages are stronger than others:
Network effects, when accelerated properly, are perhaps the strongest advantage.
Becoming synonymous with a category can have a massive impact on your business, but is a really risky path to pursue and just doesn’t work for many startups.
Gaining a wedge in through a niche audience, and then using that first audience to get to future audiences can be really powerful—but only when the product strategy is very aligned (which is why it falls into the product category).
If you have the same marketing advantages as a competitor, they’re not really advantages–leaning into them becomes table stakes.
Some advantages tend to come in pairs:
I.e If you have a network effect, you typically have a free plan to get that network effect going
I.e. If you are trying to create a new category, typically there’s a trend that’s driving the need for that category and educational content will be highly in demand.
Once you identify your advantage(s), choose channels and campaigns to accelerate your advantage(s):
Identify advantages (keeping in mind the points above) and make sure there’s cross company alignment on these.
Build a marketing plan to accelerate each advantage, follow guidance in the diagram’s orange columns on strategy and pick marketing channels that make the most sense.
Read more about the startups mentioned and what they did related to each advantage–but remember you can’t just copy and paste these company’s strategies.
I.e. Research Hubspot and Shopify’s affiliate programs
I.e. Research how Square and Toast developed initial products in more niche markets (or really any vertical SaaS startup that got really, really huge later)
I.e. Look at how Figma encouraged internal and external sharing and then layered on community templates, etc.
Keep your advantage(s) in mind not just when choosing growth tactics, but also when creating “fuel” or content to feed your growth engine.
3. Use these inputs to place strategic big bets
So you’re trying to figure out how to build or improve your marketing engine. You’ve identified the highest leverage ways to grow. You deeply understand your audience, your market, and how your GTM motion impacts marketing. You’ve figured out you have a couple of marketing advantages and want to lean in.
Now what? You need to figure out the initiatives that can change your growth trajectory as a business.
We all know the pareto principle, and yes that applies to marketing projects in my experience too. 20% of your efforts drive 80% of your growth. The trick is identifying these.
I like to plan for these big bets (aka potential step-change drivers) before I figure out any other marketing plans. Depending on team size, embark on ~1-2 per quarter.
Note: it’s usually best to do some smaller tests before going all in.
This is similar to the concept of putting the big rocks in the jar before the pebbles and sand, if you’re familiar with that analogy.
The frameworks in this newsletter help you identify these big bets or high-impact projects. But to make it even easier, here are some questions I ask startups to unlock initiatives that have the potential to cause a step-change in growth–or at least cause your slope of growth to change dramatically. Try using these in planning meetings, in discussions with your founder, or just by yourself to get your engines revving (growth engine pun intended).
Here are the best questions to help you identify growth marketing step-change drivers:
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Questions related to 4 high-level ways to grow:
Prioritize 4 high-level ways to grow (that pie diagram at the top of the newsletter) in order from 1-4. Why did you put them in this order?
Do you have product-market fit? If not, is it a product problem? A distribution problem? A market problem?
What do your most successful users all have in common?
Have you done deep audience analysis and segmentation work?
Do you have product-market fit with just a portion of your audience?
Are you seeing diminishing returns from paid search?
Is there another audience you know will love your product but aren’t yet targeting?
If you have a free product, are there people who you are surprised to see using the product? Unexpected use cases?
Is there demand for your product from other teams or people at your customers’ companies?
Have you signed most of your initial set of target accounts?
Do you feel confident that if you get the right lead to your website, it tells an effective story?
Have you optimized paid campaigns to the fullest extent?
Do you have landing pages? Do your landing pages convert higher than the homepage?
Do you have clear packages, plans, and pricing listed on your site (yes, even pricing for your lower tiers need to be on there)?
Are you minimizing friction from the time a web visitor hits a CTA button until they see the product (whether they self-serve into a free version or get on a call for a demo)?
Do you make people email to book a meeting or can they do it right there in the flow?
Have you done any lifecycle marketing to nurture leads?
Questions related to the 3 strategy drivers:
What does your audience need most to do their job better? What would they all share and tell their peers about?
Can you get a list of every company in your addressable market?
Do people in your audience talk to each other a lot? Do they have opportunities to do that? What are those opportunities?
Do some customers close in less than a week?
Can you get every user to invite 3+ additional users? How?
Do you lose customers during onboarding?
Who in your ecosystem has the most relationships with your buyers? How can you make them want to spread the word about your company?
Does your GTM motion fit your audience and market? Does it match the GTM motion of other products they regularly use?
Do you integrate with any products that have a high branded search volume?
Are there any rapidly developing trends or changes in your market that may require education, tools, etc?
If you have the potential for a network effect, what can marketing and product do to get it going faster? (note this should pretty much always be your top priority)
Are there opportunities in the product to promote unused features?
Are there any features (or data) in the product that can be turned into free tools?
What is your best-performing piece of content? Have you exhausted ways to distribute and repurpose it? Could you create a series from it?
Is there a definitive guide on how to do the job(s) of your primary audience?
How can you dramatically increase web traffic by spending no money?
Next up: Choose your channels & plan your campaigns
Now you are ready to build your growth marketing roadmap–to choose channels, to plan campaigns, to build out the marketing ops set up to support it, and to make sure you have the right fuel for your engine.
My next newsletter will dive deeper into channel selection and campaign planning specifically. In the meantime, run through these frameworks and questions for your startup. You’ll likely find yourself slashing growth programs that aren’t cutting it and adding in things that really move the needle, maybe even before 2024 hits.
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